in buying a Poconos Short Sale?
You had better
be interested in being beaten up by hooded, masked guys with
baseball bats because this is what it is going to feel like.....
going through the short sale process! Read this before proceeding
to the Short Sale Search below.
are some tips on how to survive the process.
buyers will sooner or later come across a short sale. This is
an attempt by the owner to sell a home before the bank takes it
back through foreclosure. A short sale may salvage their credit
rating and lift the burden of the mortgage debt. The short sale
process hinges on the bank taking e a loss now and approving the
sale thereby eliminating the process of foreclosing and reselling
Some information to be aware of about this process:
The Short Sale Price is set by the seller and their agent &
seller, not bank : The agent and seller will usually create
a very low asking price in order to attract lots of buyers. They
will do this to get so many buyers that they can then do a Highest
and Best offer with all of them (and sometimes more than once) The
bank is usually not aware of the asking price, but does have final
say in what an acceptable offer will be. This process often takes
months and the seller will try to put you off long enough to get
an offer that is as high as possible.
Low offers usually get no or, at the most, a very slow response:
Since the bank is usually told the price, when low offers come in
the bank does often not even respond. It takes an offer close to
the bank's investment to get their attention. Sometimes it is possible,
by searching the public record to determine how much a bank has
in the property and, if you do this research and, make on offer
close it may get the banks attention.
A good buyer's agent will check comparable's before submitting an
offer and share with you what the going price should be for the
home: The agent will check recent home sales in the area
to give buyers a better idea of the price properties like the short
sale are selling for. This ammunition will be needed to help convince
the bank that the offered price is realistic.
Don't get emotional or financially tied up in the property :
Short sales are not usually short time frames to purchase. It often,
(usually) takes much longer to "earn" a short sale than
a regular sale. Do not expect to get any one particular property.
Since there will be many bidders and the process will take a long
time, you should keep looking and trying to find a real deal in
the regular market.The reality of life today is that you will probably
will find a better deal in the general sales market before your
short sale is accepted.
Sellers with equity in other properties or or elsewhere (like boats,
cars, jewels, bank accounts, savings and etc) will not qualify for
a short sale and will be asked to pay the difference. Some will
change their minds: Sellers that have equity anywhere else
will be made to liquidate it and pay down the mortgage before the
bank will approve a short sale. The seller might be asked to sign
a promissory note to pay back all or most of the debt. Sellers often
do not cooperate with this and bulk or try to hide the other assets.A
bank will not approve a short sale and take a loss if it suspects
equity is elsewhere. Thus one more reason for delay.
"Bank Approved Short Sales " prices are quickest to close :
Sometimes the bank approves a price for a short sale in advance.
They do not usually negotiate after this price is approved. A lowball
offer will not get anywhere under these circumstances.
The bank decides on who the buyer will be .... not the seller. The
bank will pick the most appealing buyer, which may mean different
things to different banks. Some banks may prefer buyers with larger
down money. Some want the highest price.
Do not rely on an Inspection to get a discount! Repairs
are almost never done. Generally you are dealing with an "as
is" house.Sometimes there is a credit and the buyer takes the
responsibility of fixing anything.
When you get short sale approved, you must close on time :
Be prepared to close on the date the bank sets or there will be
penalties or the home will go to the next bidder
short sale process can be a terror. We have seen buyers in tears
over this process and must warn you that it is not often that it
works out. Remember the bank usually can just go to foreclosure
and take possession of the home at anytime. If this happens, the
process is void and you would usually have to start all over again
with a different foreclosure agent.